Royal Caribbean Cruises Ltd. (RCL)

Global demand for cruises is rising. Valuation currently suffering from holdover from commodity price inflation over the past 2 years. RCL is adding capacity and will be well positioned for inevitable global shift, demographically.

This is pure consumer discretionary. As the housing and economy slow over the next 6 months this company will see a serious decline in bookings

Just got off of their ship and they will pass carnival as the industry leaders!!!

Swine flu virus scare will spook cruisers and investors from this company

Second only to Carnival Cruise Lines (CCL) in the industry, Royal Caribbean continues to expand its fleet. They are introducing massive vessels that will be producing income for the company for years to come. Barring any events that may curtail travel and a continued weak dollar, the leisure industry continues to grow. While Carnival remains way ahead of the pack, Royal Caribbean is increasing fleet capacity to keep up and continue grow their chunk of the business.

baby boomer play plus opportunity to offer vacations to china's growing middle class over next five years

People will always pay for a quality product.

YES THE COST OF FUEL IS RAISING THEIR COST, BUT CRUSING IS THE BIGGIE FOR VALUE FOR DOLLAR SPENT. ROYAL IS THE BEST MID LINE...

At some point you'll want to get away from it all and this outfit seems to have their act together - as long as they can fund their debt.

Cruise line looks to be undervalued right now . . . time to pop it on the game card.

Bullish:

1. Trading around 52 week low
2. Trading below book value
3. Insider buying at $32

Bearish:

1. Fuel costs
2. Consumer sentiment and spending
3. A fair amount of debt

Overall, I think that RCL will be OK. I'm bullish on the economy in general, and over the next 2 to 4 years people will definitely be cruising. The only question that leaves me unsure will be the price of oil.

Love this maker of oversized boats; their floating cities will soon dominate the oceans.

American consumers will have less discretionary spending and access to credit will become more limited. The company has added new ships and long term debt which it may have trouble repaying.

RCCL is still filling their ships. The prices they are getting for their staterooms are above their major competitor. The new ships being built, while much larger, are as much as 25% more fuel efficient than their older ships. The innovations on the new ships will make the ships themselves a destination for the traveler. Cruising remains the most cost effective way to travel. RCCL also caters to a client who is loyal to the RCCL brand, and RCCL goes above and beyond in rewarding their loyal guests with outstanding benefits. While the price of oil will certainly affect their bottom line, their income will remain strong.

Here are some facts:
- Stock price has plunged +50% from its 52-week high
- High Debt level relative to industry
- High Capital Spending relative to industry

Here's my take:
RCL is an industry leader in efficiency based on its financial ratios. Although it's highly leveraged play is concerning due to speculation of a long economic downturn, RCL's competitive advantage lies in its ability to be more efficient than its competitors. Over the past decade, it has made substantial commitments towards improving and maintaining its industry-leading efficiency levels.

The question that remains is whether RCL can weather the storm (bad pun) until world travel picks up once again. If and when this picks up again, RCL will be in an even stronger position than its competitors with newer/better ships.

RCL is a long-term play given management's long-term game plan.

Highly leveraged to the combination of fuel prices, booking trends and yields...which is without a doubt a problem right now, and likely for the next 3-4 quarters. But the stock is already down significantly, and oil prices will impact not just the cruise companies but also auto and air travel prices, so the relative attractiveness of cruising, while perhaps diminished somewhat, should remain. Increased adoption in international markets plus the baby boom effect in the US should be favorable for demand longer term as well. Bottom difficultr to identify, so might want to take partial position here, but stock should see mid-30's to mid-40's at some point in next 2-3 yrs, which would be up 50%+ from here.

less $$ for fun

Increased cash flow, continued expansion in Europe, Revenue up, 3Q profit up 14%,
Efficiencies down the line including new fuel efficient engines, fuel price hedging, route planning, hull cleaning.
Q4 bookings exceeding last year at this time. seems strong and cheap.

RCL is a leader in the cruise industry and they are getting ready for the summer season in europe. This should translate to larger profits as they will be paid in euro's not dollars.